International Journal of Advanced Engineering, Management and Science (IJAEMS) [Vol-2, Issue-9, Sept- 2016]

Infogain Publication (Infogainpublication.com) ISSN : 2454-1311

Stock Market Prediction Using Artificial Neural

Network
Nazish Nazir1, Mudasirahma Dmutto2
1
RN Engineering & Management College Rohtak, Haryana, India
2
Department of CSE, Assistant Professor, SSM College of Engineering &Technology, Jammu and Kashmir, India

Abstract— Nowadays during increasingly developed reflect the mood of the market and not essentially the
technology of the World Wide Web and Internet, the data status of a company or the true value of the stocks. It is
is becoming extremely rich. With the application of data often that stock prices soar based on external factors and
recognition process, the information extracted from data it is not uncommon to find stock traders and investors to
has become the most important part in some areas of base their decisions on current affairs and market trends
society, management field, finance and markets, etc. It is while trying to forecast the stock of any specific
necessary to develop the valid method to understand the company.
knowledge of the data. Whether you are looking for good The two stock forecasting methods any investor or stock
investments or are into stock trading, stock prediction or trader must use are the fundamental Research and Stock
forecast plays the most crucial role in determining where Forecast Algorithms.
to put in the money or which stock to be acquired or sold. Fundamental Research is a mandatory method for any
Keywords— Artificial Neural Network, Stock Market, investor. The method involves meticulous studying of a
Forecast Algorithms. company’s financial health, the value of assets, debts,
cash, revenues, expenses, profitability and plans of
I. INTRODUCTION development. Fundamental Research is a well rounded
An investment theory suggests what parameters one stock prediction method for all the data that actually
should take into account before placing his (or her) capital matters are taken into consideration while determining the
on the market. Traditionally the investment community true value of a stock
accepts two major theories: the Firm Foundation and the Stock Forecast Algorithms are aimed at making the best
Castles in the Air. Reference to these theories allows us to use of the right time, right price and the right quantity of
understand how the market is shaped, or in other words stocks that must be traded. The Algorithm in place helps a
how the investors think and react. It is this sequence of trader to forecast the time at which the price would be the
‘thought and reaction’ by the investors that defines the most favourable to either buy or sell a stock. The system
capital allocation and thus the level of the market. There predicts absolutely on numbers and has not even remotely
is no doubt that the majority of the people related to stock affected by popular emotions. Finally, one should not get
markets is trying to achieve profit. Profit comes by caught up in the daily trading, and miss out on global
investing in stocks that have a good future (short or long trends.
term future). Thus what they are trying to accomplish one There are several methods that have been developed for
way or the other is to predict the future of the market. But the purpose of Stock Prediction Methods such as
what determines this future? The way that people invest Fundamental Analysis, Technical Analysis, Data Mining
their money is the answer; and people invest money based Technology, Internet Based Data Sources of Stock Market
on the information they hold. Prediction and Application of Complexity Science for
The factors that are under discussion on this schema are: Stock Prediction etc. These methods are: Fundamental
the content of the ‘Information’ component and the way Analysis, Technical Analysis, Data Mine Technologies
that the ‘Investor’ reacts when having this info. etc.
According to the Firm Foundation theory the market is
defined from the reaction of the investors, which is II. INDICATORS FOR STOCK PREDICTION
triggered by information that is related with the ‘real There are several indicators that are used for the purpose
value’ of firms. of stock prediction like:
Whether you are looking for good investments or are into Moving average: The moving average calculates the
stock trading, stock prediction or forecast plays the most average of past n values till today. A moving average is
crucial role in determining where to put in the money or commonly used with time series data to smooth short
which stock to be acquired or sold. Market trends often

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International Journal of Advanced Engineering, Management and Science (IJAEMS) [Vol-2, Issue-9, Sept- 2016]
Infogain Publication (Infogainpublication.com) ISSN : 2454-1311
term noisy data and highlight longer-term trends or Simon Hawkinset al. [2014] concluded that extract
cycles. information from different written resources. Thus text
Simple moving average: A simple moving average mining method can be used on various fields like social
(SMA) is the un-weighted mean of the previous data; the media, news etc. Outlier detection is used to remove
data can be in n number which is used in financial fluctuations from data.
applications. Andrea Nemeti a et al. [2015] determine that Stock
Exponential moving average:In EMA we will give more market prediction is a vast area of research where we can
weight age to recent values than historical data. For apply text mining techniques for retrieve the text and also
example we will give more weight age to data of 2015 use SVM for retrieve numerical data sets and text data.
rather than data of 2014. After prediction of stock prices we get collection of data
Rate of change: The ratio of current price to price n sets which is unstructured.
quotes earlierN is generally 5 to 10 days. For example we
will check here recent data and ups and downs in recent Alberto Arteta Albert1 et al. [2015] gave a conclusion
days rather than older days… thatusing prediction we can predict future stock prices
Relative Strength Index: Measure the relative size of that they will increase or decrease. If successful
recent upward trends against the size of downward trends prediction of stock then it will be beneficial for future and
within specified time interval. It will check ups in market with stock market prediction profit will also increase.
prices and downs in market prices. There are moving averages algorithms like SMA,EMA,
Process of Stock Prediction: ROI will be use for stock market prediction.

NilamUpasaniaet al. [2015] explains that we have to

make unstructured data into structured data and remove
noisy data from data sets. Noisy data can be missing
value, duplicated data, etc. Removing of noisy data is also
called outlier detection which use different mining
methods for detection of noise and then remove it.
Forecasting stock market movement direction with
support vector machine

IV. OBJECTIVES AND METHODOLOGY OF

THE WORK
The objective of the work that is performed involves
collection and pre processing the stock market data and
applying filters that are moving average, weighted,
triangular, exponential on the pre-processed stock market
data and further applying neural network to predict
performance of stock and to compare the performance of
proposed and existing system.
III. RELATED WORK
Research methodology:
Raluca-Mariana tefan [2012] states that there are
different methods of data classification. In it we divide
data into categories for use them at highest level. Which
will provide effectiveness and efficient data?
Ian H. Witten[2013] determines that Text mining is a
multidisciplinary field which is involved in information
retrieval, text analysis, information extraction, clustering,
categorization, database technology, machine learning
and data mining.
MAHESH T R et al.[2010] explain thatText mining is a
new research area in which we mine knowledge from
unstructured text. It means we mine needed text /
information using text mining.

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International Journal of Advanced Engineering, Management and Science (IJAEMS) [Vol Issue-9, Sept- 2016]
[Vol-2,
Infogain Publication (Infogainpublication.com
Infogainpublication.com)) ISSN : 2454-1311
The figure below shows the functionality of neural
network
twork on the stock data set

Facilities used
My proposed work plan for research is as following:-
following:
Data Collection: - Firstly data will collect from
companies, news, and social media. The figure below shows the validation performance of
Training data: - All training data of stock market will save dataset using neural network
in excel sheet using MS_EXCEL.
Test data: Test data will from companies and store test
data of stock market in excel sheet.
Simulator:- MATLAB r2010a will be useas a simulator
for stock market prediction.
After prediction of stock price our objective is to remove
fluctuations from data using moving average algorithms in
MATLAB
Results:
The figure below shows Results if filters applied on the
stock data set

V. CONCLUSION
The extracted data can be used for applications ranging
from market analysis. It decomposes the original stock
indexinto the trend terms, the market fluctuation terms,
the noise terms and time series with different
economicfeatures. Then SVM will use all moving average
algorithm to predict stock prices. After prediction of stock
prices using all algorithms the result of all algorithm will
combine. Then moving average algorithms result will
check the duplicate and missing values in data and

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International Journal of Advanced Engineering, Management and Science (IJAEMS) [Vol-2, Issue-9, Sept- 2016]
Infogain Publication (Infogainpublication.com) ISSN : 2454-1311
remove noisy data. In future we can integrate fuzzy logic
in it to smooth out the data and remove the fluctuations.
Thus after prediction we remove the noisy data and also
fill the missing values. So the result of prediction will be
clean data without any noisy and missing values.

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